Is this what the biggest issue in UK politics in 300 years come down to? The Yes vote has lots of emotion, buoyed by folk music, even a little visceral hatred of the Auld Enemy, resulting in shouty audiences and not a little intimidation of the “nay sayers”. On the other hand Better Together has so far tried to focus on facts but, until Gordon Brown’s intervention I have not heard any emotional please to stand by the United Kingdom a union that led the world for nearly 3 centuries and today still hits far above its weight on the world stage, not for its economic strength (which has, lets face it been variable over the last 50 years) not even for its inventiveness and enterprise those these count for a lot, but I believe because also for its integrity and as a beacon of freedom and democracy. OK, so nothing says that Scotland will not be democratic, libertarian and enterprising, but it is a fact that in the scheme of things it will be a small, but no doubt proud, nation, that will have little or no sway in world or even EU politics (on the assumption that it will eventually be allowed to join).
So lets have some emotion on the Better Together side that the Scots an connect to. You can be proud of being a small nation, just as citizens of Kiribati are when they win their first Olympic gold medal, but that is not the same as being part of a United Kingdom that holds its place on the regional and world stage.
Turning to facts, there seems far to little data published and much to much trust put in the spokespersons to interpret it. Here are some (taken from UK Office of National Statistics unless otherwise stated). Overall is it clear that Scotland has a higher burden of public expenditure per head and a lower income per head than the UK as a whole, however you spin the figures. North Sea Oil helps of course but does not completely close the gap. Perhaps arguing about whether people are £1,000 worse off, or £1,000 better off is all in the roundings and estimates, but I would have thought it is pretty obvious that Scotland will need to work a lot harder and more effectively than it does now to achieve the economic benefits that the independence campaign is offering. Can it do this as a small, peripheral country on the EU? My head tells me no, but perhaps the heart of a patriotic Scots person will say yes. Either way Better Together, can you do better, please?
Economy
- Gross Value Add per head (Latest data, for 2011): Scotland £20.5k; England £21.3k; UK £21.4k. (NB: for London this is £36k per head. Should London have a referendum for independence on this basis?)
- Disposable Income per head (2013): Scotland £15.7k; England £16.3k; UK £16.0k.
- Unemployment rates (2012): Scotland 7.7%; England 7.7%; UK 7.8%. So overall these are broadly similar, though there are of course wide variations within the countries. For example the figure for Glasgow was 11.7%, with this offset by lower rates in other parts of Scotland.
- Public Sector Expenditure (includes Central and Local govt and Public Corporations) (Latest 2011/12): Scotland £53bln; England £451bln; UK £572bln (this excludes “unidentifiable” items, i.e. not identified to a region or country, of which roughly half is public sector debt interest).
- Public Sector Expenditure per head (Latest 2011/12): Scotland £10.1k; England £8.5k; UK £8.7k.
- Local Government Expenditure (included in public sector above) (Latest 2011/12): Scotland £2,932 per head; England £2,545 / head; UK £2,520 per head. Scotland spends on average £400 per head more on local authority activities than the rest of the UK.
- Public Sector Employment (Q4 2012): Scotland 580k (24% of workforce); England 4,582k (18.4% of workforce); UK 5,736 (19.3% of workforce). Some of these jobs are clearly servicing the whole of the United Kingdom. How many of these are located in Scotland? Given lower earnings/value add north of the border, one may assume that after central government efforts to move jobs to the regions, it is proportionately more in Scotland than in England. These would then be jobs lost to the Scottish economy. Alternatively, if all the jobs are providing services in Scotland then it suggests a much higher burden of public sector on the local economy than in the UK as a whole.
- Private sector services to the public sector are presumably not included in the above. I assume procurement cost covers this, which was £192bln in 2012/13 or 29% of total public sector expenditure. I have not found a breakdown of this cost between Scotland and the rest of the UK.
- Elsewhere (IFS “Scottish Independence: the fiscal context” Nov 2012): “Public spending per head is about £1,200 a year higher in Scotland than in the UK as a whole (about £11,800 against £10,600 in 2010-11), and is higher across most areas of government activity. This is despite the fact that household disposable income per head in Scotland is very similar to the UK average”. These figures are higher than the ONS figures quoted above, but the differential are roughly the same.
- Revenues are not formerly recorded by country or region but HMRC have published estimates. The figures below were taken from an Institute of Fiscal Studies summary and analysis.
- Revenues excluding North Sea (Petroleum Revenue Tax): Scotland £7.1k per person; UK £7.1k.
- Revenues including North Sea split on a geographical basis (i.e. based on which national territory the fields would lie) Scotland would get approx £1,000 pa more, per head. The amount of England does not seem to be material. The Scottish Government however estimates slightly more, hence the figure of £1,400 that I think the Yes campaign uses. This is based on a different estimate of revenue but the same geographic split (i.e. no argument about who owns the oil).
- HMRC does publish a split of total revenue by source showing Petroleum Revenue Tax at approx £1.1bln in 2012/2013 (included in total Hydrocarbon taxes which also includes fuel duty), down from £2.0bln in 2011/12 and £1.6bln in 2007/8.
- GERS (Scottish Government) estimates a deficit (2013?) of £14.2bln excluding North Sea and £8.6bln (5.9% of GDP) including North Sea Revenues.
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